A Tale of Three Cities

In the past month I’ve been to venture conferences in three cities:  New York, San Francisco, and Boston.  (I rarely go to so many; events conspired this year.) This invites a comparison.

Empire State Building, Hoover Tower, Brandt Point Lighthouse

The New York conference (TechCrunch/Disrupt) stropped its edge and trumpeted media, personalities, and disrupting everything, not least venture capital (more here).  There were a lot of entrepreneurs present, mostly from digital media and SoLoMo (“social/local/mobile”) companies, execs from Google, Facebook, and AOL, “super” angels, new-wave VCs, and very few established VCs or institutional LPs.  I left believing that New York has a vibrant venture market, and SoLoMo/Digital Media is having a great run, but knew that already.

The IBF Conference in Silicon Valley was a stark contrast.  Many of the good and great of the venture industry attended this long-established conference, mostly to speak or receive an award.  I moderated the Early Stage VC panel, including GPs from KP, InterWest, Redpoint, and Bessemer.  Still buzzing from New York, I asked if the business model has changed.  The answer was a resounding “no”.  Web deals (Digital Media & SoLoMo) are not the dominant investment theme; seed investment is not a major part of the strategy; back-able CEOs are still mostly over 30; and B2B is still part of the strategy.  For web deals, smaller initial investments, fast diligence, and under-30 CEOs can make sense, but $10s of millions are needed to scale, there are dozens of failures for each famous success, and the real challenge is to have the bandwidth to screen all the deals.

The overwhelming impression from the Valley was adaptation from a secure base:  the rules have adjusted, not disrupted, and the great investors are still great.  Jim Breyer was the principal honoree.  Jim began his career as a telecom investor, and is credited with leading a reinvention of Accel as a digital media investor with several successes, most notably Facebook.

The Nantucket Conference is the most significant Boston conference of the year, and had a quite different tone: it looked at VC broadly, and reflectively.

  • Investment themes discussing ranged across enterprise IT hardware, materials, and mechatronic prosthetics in addition to good attention to web deals.
  • Part of the agenda was skills development:  M&A, leading through and beyond the IPO.
  • The atmosphere was much more intimate.  Many important VCs and entrepreneurs were present and did not pop in and out (the island venue helps here).  It felt like we are colleagues together.

Boston is challenged in IT venture, partly due to the lack of a big, hot seam to mine with local critical mass, like Social Media in the Valley or Ad-Tech in New York.  But partly it’s culture.  We’ve been criticized for lack of collaboration in the past, but I don’t see that now, as evidenced by the conference atmosphere.  The big issue teed up at Nantucket was “open thinking”: adapting much faster to new markets and ways of building businesses.


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